Invesco Fundamental Value Fund

Transcription

1 Prospectus December 22, 2010 as revised December 23, 2010 Class: A (FVFAX), B (FVFBX), C (FVFCX), Y (FVFDX) Invesco Fundamental Value Fund Go Paperless with edelivery Visit invesco.com/edelivery

2 Invesco Retail SUP Prospectus Supplement dated December 23, 2010 The purpose of this supplement is to provide you with changes to the current Prospectus for Class A, B, C, R and Y Shares, as applicable, of each of the Funds listed below: Invesco Balanced Fund Invesco Dividend Growth Securities Fund Invesco Fundamental Value Fund Invesco Van Kampen Core Equity Fund Following a number of meetings in September and October, 2010, the Boards of Trustees of the Invesco Funds have unanimously approved an Agreement and Plan of Reorganization (the Agreement ) pursuant to which each Target Fund listed below would transfer all of its assets and liabilities to the corresponding Acquiring Fund listed below in exchange for shares of the Acquiring Fund that would be distributed to Target Fund shareholders: TARGET FUND Invesco Balanced Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) Invesco Dividend Growth Securities Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) Invesco Fundamental Value Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) Invesco Van Kampen Core Equity Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) ACQUIRING FUND Invesco Van Kampen Equity and Income Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) Invesco Diversified Dividend Fund, a series portfolio of AIM Equity Funds (Invesco Equity Funds) Invesco Van Kampen Growth and Income Fund, a series portfolio of AIM Counselor Series Trust (Invesco Counselor Series Trust) Invesco Diversified Dividend Fund, a series portfolio of AIM Equity Funds (Invesco Equity Funds) The Agreement requires approval by the Target Fund shareholders and will be submitted to the shareholders for their consideration at a meeting to be held in or around April If the Agreement is approved by shareholders of the Target Funds and certain conditions required by the Agreement are satisfied, the reorganizations are expected to be consummated shortly thereafter. Upon closing of the reorganizations, shareholders of the Target Fund will receive a corresponding class of shares of the Acquiring Fund in exchange for their shares of the Target Fund, and the Target Fund will liquidate and cease operations. Shareholders of each Target Fund will vote separately on the Agreement, and the reorganization will be effected as to a particular Target Fund only if that fund s shareholders approve the Agreement. A combined Proxy Statement/Prospectus will be sent to shareholders of each Target Fund to seek their approval of the Agreement, which will include a full discussion of the reorganization and the factors the Boards of Trustees considered in approving the Agreement. If shareholders approve a reorganization, it is anticipated that the Target Fund will close to new investors as soon as practicable following shareholder approval through the consummation of the reorganization to facilitate a smooth transition of Target Fund shareholders to the Acquiring Fund. The Acquiring Fund will remain open for purchase during this period. All investors who are invested in a Target Fund as of the date on which the Target Fund closed to new investors and remain invested in the Target Fund may continue to make additional investments in their existing accounts and may open new accounts in their name. Invesco Retail SUP

3 Prospectus December 22, 2010 as revised December 23, 2010 Class: A (FVFAX), B (FVFBX), C (FVFCX), Y (FVFDX) Invesco Fundamental Value Fund Invesco Fundamental Value Fund s investment objective is to provide total return. As with all other mutual fund securities, the Securities and Exchange Commission (SEC) has not approved or disapproved these securities or determined whether the information in this prospectus is adequate or accurate. Anyone who tells you otherwise is committing a crime. An investment in the Fund: m is not FDIC insured; m may lose value; and m is not guaranteed by a bank.

4 Table of Contents Fund Summary 1 Investment Objective, Strategies, Risks and Portfolio Holdings 3 Fund Management 6 The Adviser 6 Adviser Compensation 6 Portfolio Managers 6 Other Information 7 Sales Charges 7 Distributions 7 Dividends 7 Capital Gains Distributions 7 Benchmark Descriptions 7 Financial Highlights 8 Shareholder Account Information A-1 Choosing a Share Class A-1 Share Class Eligibility A-2 Distribution and Service (12b-1) Fees A-3 Initial Sales Charges (Class A Shares Only) A-3 Contingent Deferred Sales Charges (CDSCs) A-4 Redemption Fees A-5 Purchasing Shares A-6 Redeeming Shares A-7 Exchanging Shares A-9 Rights Reserved by the Funds A-10 Excessive Short-Term Trading Activity (Market Timing) Disclosures A-10 Pricing of Shares A-11 Taxes A-13 Payments to Financial Intermediaries A-14 Important Notice Regarding Delivery of Security Holder Documents A-15 Obtaining Additional Information Back Cover Invesco Fundamental Value Fund

5 Fund Summary Investment Objective The Fund s investment objective is to provide total return. Fees and Expenses of the Fund This table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. You may qualify for sales charge discounts if you and your family invest, or agree to invest in the future, at least $50,000 in the Invesco Funds. More information about these and other discounts is available from your financial professional and in the section Shareholder Account Information Initial Sales Charges (Class A Shares Only) on page A-3 of the prospectus and the section Purchase, Redemption and Pricing of Shares Purchase and Redemption of Shares on page L-1 of the statement of additional information (SAI). Shareholder Fees (fees paid directly from your investment) Class: A B C Y Maximum Sales Charge (Load) Imposed on Purchases (as a percentage of offering price) 5.50% None None None Maximum Deferred Sales Charge (Load) (as a percentage of original purchase price or redemption proceeds, whichever is less) None 5.00% 1.00% None Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) Class: A B C Y Management Fees 0.67% 0.67% 0.67% 0.67% Distribution and/or Service (12b-1) Fees None Other Expenses Total Annual Fund Operating Expenses Other Expenses and Total Annual Fund Operating Expenses are based on estimated amounts for the current fiscal year. Example. This Example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. The Example assumes that you invest $10,000 in the Fund for the time periods indicated and then redeem all of your shares at the end of those periods. The Example also assumes that your investment has a 5% return each year and that the Fund s operating expenses remain the same. Although your actual costs may be higher or lower, based on these assumptions your costs would be: 1 Year 3 Years 5 Years 10 Years Class A $697 $1,007 $1,338 $2,273 Class B ,050 1,848 Class C ,220 2,615 Class Y ,545 You would pay the following expenses if you did not redeem your shares: 1 Year 3 Years 5 Years 10 Years Class A $697 $1,007 $1,338 $2,273 Class B ,848 Class C ,220 2,615 Class Y ,545 Portfolio Turnover. The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses or in the example, affect the Fund s performance. The portfolio turnover rate of the Morgan Stanley Fundamental Value Fund (the predecessor fund) and the Fund for the fiscal period October 1, 2009 to August 31, 2010 was 16% of the average value of the portfolio. Principal Investment Strategies of the Fund The Fund will normally invest at least 65% of its assets in common stocks and other equity securities, which can include depositary receipts, preferred stocks or securities convertible into common or preferred stock. The Fund s investment adviser, Invesco Advisers, Inc. (the Adviser), primarily focuses on equity securities of larger capitalization companies (i.e., companies with over $10 billion of market capitalization currently), but the Fund may also invest in small and medium capitalization companies. Up to 15% of the Fund s net assets may be invested in convertible securities rated below investment grade (commonly referred to as junk bonds). The Fund may also use derivative instruments. These derivative instruments will be counted toward the 65% policy discussed above to the extent they have economic characteristics similar to the securities included within that policy. The Fund may also invest up to 25% of its net assets in foreign securities. This percentage limitation, however, does not apply to foreign securities that are traded in the United States on a national securities exchange. In addition, the Fund may invest in investment grade fixedincome securities. The Fund may also invest up to 15% of its net assets in real estate investment trusts (REITs). In selecting securities for investment, the Adviser utilizes a bottom-up investment process that seeks to identify companies with potential for improved market valuations. The Adviser analyzes quantitative and fundamental research on each company with a focus on identifying potential catalysts for change, such as new management, an industry development or a regulatory change, that could benefit the company and cause its stock price to rise. The Adviser sells a security when it believes that it no longer fits the Fund s investment criteria. The Adviser currently anticipates that the Fund s portfolio will consist of a relatively small number of holdings. The remaining 35% of the Fund s assets may be invested in investment grade non-convertible debt securities, including corporate debt securities and U.S. government securities. The Fund s fixed-income investments may include zero coupon securities which are purchased at a discount and accrue interest, but make no interest payments until maturity. The Fund may, but it is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio management or to earn income. The Fund s use of derivatives may involve the purchase and sale of derivative instruments such as options, futures and swaps and other related instruments and techniques. The Fund may utilize forward foreign currency exchange contracts, which are also derivatives, in connection with its investments in foreign securities. Principal Risks of Investing in the Fund As with any mutual fund investment, loss of money is a risk of investing. An investment in the Fund is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation (FDIC) or any other government agency. The risks associated with an investment in the Fund can increase during times of significant market volatility. The principal risks of investing in the Fund are: Common Stocks and Other Equity Securities. In general, stock and other equity security values fluctuate, and sometimes widely fluctuate, in response to activities specific to the company as well as general market, economic and political conditions. Investments in convertible securities subject the Fund to the risks associated with both fixed-income securities, including credit risk and interest rate risk, and common stocks. A portion 1 Invesco Fundamental Value Fund

6 of the Fund s convertible investments may be rated below investment grade. Value Investing Style. The Fund emphasizes a value style of investing, which focuses on undervalued companies with characteristics for improved valuations. This style of investing is subject to the risk that the valuations never improve or that the returns on value equity securities are less than returns on other styles of investing or the overall stock market. Value stocks also may decline in price, even though in theory they are already underpriced. Fixed-Income Securities. All fixed-income securities are subject to two types of risk: credit risk and interest rate risk. When the general level of interest rates goes up, the prices of most fixed-income securities go down. When the general level of interest rates goes down, the prices of most fixed-income securities go up. Lower Rated Securities (Junk Bonds). The prices of these securities are likely to be more sensitive to adverse economic changes, resulting in increased volatility of market prices of these securities during periods of economic uncertainty, or adverse individual corporate developments, than higher-rated securities. In addition, during an economic downturn or substantial period of rising interest rates, junk bond issuers and, in particular, highly leveraged issuers may experience financial stress. Foreign and Emerging Market Securities. Investments in foreign markets entail special risks such as currency, political, economic and market risks. There also may be greater market volatility, less reliable financial information, higher transaction and custody costs, decreased market liquidity and less government and exchange regulation associated with investments in foreign markets. The risks of investing in emerging market countries are greater than risks associated with investments in foreign developed countries. Hedging the Fund s currency risks through forward foreign currency exchange contracts involves the risk of mismatching the Fund s objectives under a forward foreign currency exchange contract with the value of securities denominated in a particular currency. There is additional risk that such transactions reduce or preclude the opportunity for gain and that currency contracts create exposure to currencies in which the Fund s securities are not denominated. REITs. REITs are susceptible to risks associated with the ownership of real estate and the real estate industry in general. In addition, REITs depend on specialized management skills, may not be diversified, may have less trading volume and may be subject to more abrupt or erratic price movements than the overall securities market. Investments in REITs may involve duplication of management fees and certain other expenses. Derivatives. A derivative instrument often has risks similar to its underlying instrument and may have additional risks, including imperfect correlation between the value of the derivative and the underlying instrument, risks of default by the other party to certain transactions, magnification of losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which they relate, and risks that the transactions may not be liquid. Certain derivative transactions may give rise to a form of leverage. Leverage magnifies the potential for gain and the risk of loss. The derivative instruments and techniques that the Fund may principally use include: Swaps. A swap contract is an agreement between two parties pursuant to which the parties exchange payments at specified dates on the basis of a specified notional amount, with the payments calculated by reference to specified securities, indexes, reference rates, currencies or other instruments. Swaps are subject to credit risk and counterparty risk. Futures. A decision as to whether, when and how to use futures involves the exercise of skill and judgment and even a well conceived futures transaction may be unsuccessful because of market behavior or unexpected events. Options. A decision as to whether, when and how to use options involves the exercise of skill and judgement and even a well conceived option transaction may be unsuccessful because of market behavior or unexpected events. The prices of options can be highly volatile and the use of options can lower total returns. Performance Information The bar chart and performance table provide an indication of the risks of investing in the Fund. The bar chart shows changes in the performance of the Fund from year to year as of December 31. The performance table compares the Fund s performance to that of a broad-based securities market benchmark, style specific benchmark and a peer group benchmark with investment objectives and strategies similar to the Fund. The Fund s (and the predecessor fund s) past performance (before and after taxes) is not necessarily an indication of its future performance. The returns shown are those of the Class A, Class B, Class C and Class I shares of the predecessor fund. The predecessor fund was advised by Morgan Stanley Investment Advisors Inc. Class A, Class B, Class C and Class I shares of the predecessor fund were reorganized into Class A, Class B, Class C and Class Y shares, respectively, of the Fund on June 1, Class A, Class B, Class C and Class Y shares returns of the Fund will be different from the predecessor fund as they have different expenses. Performance for Class A and Class B shares has been restated to reflect the Fund s applicable sales charge. Performance for Class B shares assumes conversion to Class A shares eight years after the start of the performance period. Year-to-date returns include returns of the Fund for periods ending on and after June 1, Updated performance information is available on the Fund s Web site at Annual Total Returns 30% 20% 10% 0% -10% -20% -30% -40% % 14.08% 8.77% 15.64% 3.03% (30.97)% 24.10% Class A Shares year-to-date (ended September 30, 2010): 0.30% Best Quarter (ended September 30, 2009): 20.30% Worst Quarter (ended December 31, 2008): (19.77)% Average Annual Total Returns (for the periods ended December 31, 2009) 1 Year 5 Years Since Inception Class A: Inception (10/29/02) Return Before Taxes 17.24% 0.96% 6.44% Return After Taxes on Distributions (0.24) 5.23 Return After Taxes on Distributions and Sale of Fund Shares Class B: Inception (10/29/02) Class C: Inception (10/29/02) Class Y: Inception (10/29/02) S&P 500» Index 1 : Inception (10/31/02) (reflects no deductions for fees, expenses or taxes) Russell 1000» Value Index 1 : Inception (10/31/02) (reflects no deductions for fees, expenses or taxes) (0.25) 6.03 Lipper Large-Cap Value Funds Index: Inception (10/31/02) The Fund has elected to use the S&P 500» Index as its broad-based benchmark instead of the Russell 1000» Value Index and the Russell 1000» Value Index as its style specific benchmark to more appropriately reflect the Fund s investment style. After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on an investor s tax situation and may differ from those shown, and after-tax returns shown are not relevant to investors who hold their Fund shares through tax-deferred arrangements, such as 401(k) plans or individual retirement accounts. After-tax returns are shown for Class A shares only and after-tax returns for other classes will vary. 2 Invesco Fundamental Value Fund

7 Management of the Fund Investment Adviser: Invesco Advisers, Inc. (the Adviser). Portfolio Managers Title Length of Service on the Fund Thomas Bastian Portfolio Manager (lead) 2010 (predecessor fund 2003) Mark Laskin Portfolio Manager 2010 (predecessor fund 2007) Mary Jayne Maly Portfolio Manager 2010 (predecessor fund 2008) Sergio Marcheli Portfolio Manager 2010 (predecessor fund 2003) James Roeder Portfolio Manager 2010 (predecessor fund 2002) Purchase and Sale of Fund Shares You may purchase, redeem or exchange shares of the Fund on any business day through your financial adviser, through our Web site at by mail to Invesco Investment Services, Inc., P.O. Box 4739, Houston, Texas , or by telephone at New or additional investments in Class B shares are no longer permitted. The minimum investments for Class A, C and Y shares for Fund accounts are as follows: Type of Account Initial Investment Per Fund Additional Investments Per Fund Asset or fee-based accounts managed by your financial adviser None None Eligible employee benefit plans, SEP, SARSEP and SIMPLE IRA plans None None IRAs, Roth IRAs and Coverdell ESA accounts if the new investor is purchasing shares through a systematic purchase plan $25 $25 All other types of accounts if the investor is purchasing shares through a systematic purchase plan IRAs, Roth IRAs and Coverdell ESAs All other accounts 1, Tax Information The Fund s distributions are generally taxable to you as ordinary income, capital gains or some combination of both, unless you are investing through a tax-deferred arrangement, such as a 401(k) plan or an individual retirement account. Payments to Broker-Dealers and Other Financial Intermediaries If you purchase the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and the Fund s distributor or its related companies may pay the intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or other intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary s Web site for more information. Investment Objective, Strategies, Risks and Portfolio Holdings Investment Objective The Fund s investment objective is to provide total return. An investment objective having the goal of total return means selecting securities with the potential to rise in price and pay out income. The Fund s investment objective may be changed by the Board of Trustees (the Board) without shareholder approval. Principal Investment Strategies The Fund will normally invest at least 65% of its assets in common stocks and other equity securities, which can include depositary receipts, preferred stocks or securities convertible into common or preferred stock. The Adviser primarily focuses on equity securities of larger capitalization companies (i.e., companies with over $10 billion of market capitalization currently), but the Fund may also invest in small and medium capitalization companies. The Fund may also use derivative instruments as discussed below. These derivative instruments will be counted toward the 65% policy discussed above to the extent they have economic characteristics similar to the securities included within that policy. Up to 15% of the Fund s net assets may be invested in convertible securities rated below investment grade (commonly referred to as junk bonds). The Fund may also invest up to 25% of its net assets in foreign securities. This percentage limitation, however, does not apply to foreign securities that are traded in the United States on a national securities exchange. The Fund may also invest up to 15% of its net assets in REITs. In selecting securities for investment, the Adviser utilizes a bottom-up investment process that seeks to identify companies with potential for improved market valuations. The Adviser analyzes quantitative and fundamental research on each company with a focus on identifying potential catalysts for change that could benefit the company and cause its stock price to rise. Examples of catalysts for change can include new management, an industry development or a regulatory change. In assessing the strength of a company, the Adviser generally analyzes value measures, such as price/earnings ratios, cash flow and enterprise value/sales ratios, relative to the company s return on capital. The Adviser may also consider the company s ability to pay a dividend, among other factors. The Adviser currently anticipates that the Fund s portfolio will consist of a relatively small number of holdings (i.e., companies). In determining whether to sell a security, the Adviser considers a number of factors, including changes in the issuer s financial and/or industry position, as well as general economic and market conditions. Common stock is a share ownership or equity interest in a corporation. It may or may not pay dividends, as some companies reinvest all of their profits back into their businesses, while others pay out some of their profits to shareholders as dividends. A convertible security is a bond, preferred stock or other security that may be converted into a prescribed amount of common stock at a prestated price. A depositary receipt is generally issued by a bank or financial institution and represents an ownership interest in the common stock or other equity securities of a foreign company. The remaining 35% of the Fund s assets may be invested in investment grade non-convertible debt securities, including corporate debt securities and U.S. government securities. The Fund s fixed-income investments may include zero coupon securities which are purchased at a discount and accrue interest, but make no interest payments until maturity. The Fund may also invest in exchange-traded index funds (ETFs). The Fund may, but it is not required to, use derivative instruments for a variety of purposes, including hedging, risk management, portfolio management or to earn income. Derivatives are financial instruments whose value is based on the value of another underlying asset, interest rate, index or financial instrument. The Fund s use of derivatives may involve the purchase and sale of derivative instruments such as options, futures and swaps and other related instruments and techniques. The Fund may also use forward foreign currency exchange contracts, which are also derivatives, in connection with its investments in foreign securities. In pursuing the Fund s investment objective, the Adviser has considerable leeway in deciding which investments it buys, holds or sells on a day-to-day basis and which investment strategies it uses. For example, the Adviser in its discretion may determine to use some permitted trading investment while not using others. The Adviser sells a security when it believes that it no longer fits the Fund s investment criteria. 3 Invesco Fundamental Value Fund

8 Principal Risks Common Stocks and Other Equity Securities. A principal risk of investing in the Fund is associated with its common stock investments. In general, stock values fluctuate in response to activities specific to the company as well as general market, economic and political conditions. Stock prices can fluctuate widely in response to these factors. Investments in convertible securities subject the Fund to the risks associated with both fixed-income securities and common stocks. To the extent that a convertible security s investment value is greater than its conversion value, its price will likely increase when interest rates fall and decrease when interest rates rise, as with a fixed-income security. If the conversion value exceeds the investment value, the price of the convertible security will tend to fluctuate directly with the price of the underlying equity security. A portion of the convertible securities in which the Fund may invest may be rated below investment grade. Securities rated below investment grade are commonly known as junk bonds and have speculative credit risk characteristics. Value Investing Style. The Fund emphasizes a value style of investing, which focuses on undervalued companies with characteristics for improved valuations. This style of investing is subject to the risk that the valuations never improve or that the returns on value equity securities are less than returns on other styles of investing or the overall stock market. Value stocks also may decline in price, even though in theory they are already underpriced. Different types of stocks tend to shift in and out of favor depending on market and economic conditions and the Fund s performance may sometimes be lower or higher than that of other types of funds (such as those emphasizing growth stocks). Fixed-Income Securities. All fixed-income securities are subject to two types of risk: credit risk and interest rate risk. Credit risk refers to the possibility that the issuer of a security will be unable to make interest payments and/or repay the principal on its debt. Interest rate risk refers to fluctuations in the value of a fixed-income security resulting from changes in the general level of interest rates. When the general level of interest rates goes up, the prices of most fixed-income securities go down. When the general level of interest rates goes down, the prices of most fixedincome securities go up. (Zero coupon securities are typically subject to greater price fluctuations than comparable securities that pay interest.) Lower Rated Securities (Junk Bonds). Lower rated securities (commonly known as junk bonds) are subject to greater risk of loss of income and principal than higher-rated securities. The prices of junk bonds are likely to be more sensitive to adverse economic changes or individual corporate developments than higher-rated securities. During an economic downturn or substantial period of rising interest rates, junk bond issuers and, in particular, highly leveraged issuers may experience financial stress that would adversely affect their ability to service their principal and interest payment obligations, to meet their projected business goals or to obtain additional financing. In the event of a default, the Fund may incur additional expenses to seek recovery. The secondary market for junk bonds may be less liquid than the markets for higher quality securities and, as such, may have an adverse effect on the market prices of certain securities. Many junk bonds are issued as Rule 144A securities. Rule 144A securities could have the effect of increasing the level of Fund illiquidity to the extent the Fund may be unable to find qualified institutional buyers interested in purchasing the securities. The illiquidity of the market may also adversely affect the ability of the Fund s Trustees to arrive at a fair value for certain junk bonds at certain times and could make it difficult for the Fund to sell certain securities. In addition, periods of economic uncertainty and change probably would result in an increased volatility of market prices of high yield securities and a corresponding volatility in the Fund s net asset value. Foreign and Emerging Market Securities. The Fund s investments in foreign securities involve risks that are in addition to the risks associated with domestic securities. One additional risk is currency risk. While the price of Fund shares is quoted in U.S. dollars, the Fund may convert U.S. dollars to a foreign market s local currency to purchase a security in that market. If the value of that local currency falls relative to the U.S. dollar, the U.S. dollar value of the foreign security will decrease. This is true even if the foreign security s local price remains unchanged. Foreign securities also have risks related to economic and political developments abroad, including expropriations, confiscatory taxation, exchange control regulation, limitations on the use or transfer of Fund assets and any effects of foreign social, economic or political instability. Foreign companies, in general, are not subject to the regulatory requirements of U.S. companies and, as such, there may be less publicly available information about these companies. Moreover, foreign accounting, auditing and financial reporting standards generally are different from those applicable to U.S. companies. Finally, in the event of a default of any foreign debt obligations, it may be more difficult for the Fund to obtain or enforce a judgment against the issuers of the securities. Securities of foreign issuers may be less liquid than comparable securities of U.S. issuers and, as such, their price changes may be more volatile. Furthermore, foreign exchanges and broker-dealers are generally subject to less government and exchange scrutiny and regulation than their U.S. counterparts. In addition, differences in clearance and settlement procedures in foreign markets may cause delays in settlement of the Fund s trades effected in those markets and could result in losses to the Fund due to subsequent declines in the value of the securities subject to the trades. The foreign securities in which the Fund may invest may be issued by issuers located in emerging market or developing countries. Compared to the United States and other developed countries, emerging market or developing countries may have relatively unstable governments, economies based on only a few industries and securities markets that trade a small number of securities. Securities issued by companies located in these countries tend to be especially volatile and may be less liquid than securities traded in developed countries. In the past, securities in these countries have been characterized by greater potential loss than securities of companies located in developed countries. Depositary receipts involve many of the same risks as those associated with direct investment in foreign securities. In addition, the underlying issuers of certain depositary receipts, particularly unsponsored or unregistered depositary receipts, are under no obligation to distribute shareholder communications to the holders of such receipts, or to pass through to them any voting rights with respect to the deposited securities. In connection with its investments in foreign securities, the Fund also may enter into contracts with banks, brokers or dealers to purchase or sell securities or foreign currencies at a future date (forward contracts). A foreign currency forward contract is a negotiated agreement between the contracting parties to exchange a specified amount of currency at a specified future time at a specified rate. The rate can be higher or lower than the spot rate between the currencies that are the subject of the contract. Forward foreign currency exchange contracts may be used to protect against uncertainty in the level of future foreign currency exchange rates or to gain or modify exposure to a particular currency. In addition, the Fund may use cross currency hedging or proxy hedging with respect to currencies in which the Fund has or expects to have portfolio or currency exposure. Cross currency hedges involve the sale of one currency against the positive exposure to a different currency and may be used for hedging purposes or to establish an active exposure to the exchange rate between any two currencies. Hedging the Fund s currency risks involves the risk of mismatching the Fund s objectives under a forward or futures contract with the value of securities denominated in a particular currency. Furthermore, such transactions reduce or preclude the opportunity for gain if the value of the currency should move in the direction opposite to the position taken. There is an additional risk to the effect that currency contracts create exposure to currencies in which the Fund s securities are not denominated. Unanticipated changes in currency prices may result in poorer overall performance for the Fund than if it had not entered into such contracts. 4 Invesco Fundamental Value Fund

9 REITs. REITs pool investors funds for investment primarily in real estate properties or real estate-related loans. REITs generally derive their income from rents on the underlying properties or interest on the underlying loans, and their value is impacted by changes in the value of the underlying property or changes in interest rates affecting the underlying loans owned by the REITs. REITs are more susceptible to risks associated with the ownership of real estate and the real estate industry in general. These risks can include fluctuations in the value of underlying properties; defaults by borrowers or tenants; market saturation; changes in general and local economic conditions; decreases in market rates for rents; increases in competition, property taxes, capital expenditures or operating expenses; and other economic, political or regulatory occurrences affecting the real estate industry. In addition, REITs depend upon specialized management skills, may not be diversified (which may increase the volatility of a REIT s value), may have less trading volume and may be subject to more abrupt or erratic price movements than the overall securities market. Furthermore, investments in REITs may involve duplication of management fees and certain other expenses, as the Fund indirectly bears its proportionate share of any expenses paid by REITs in which it invests. U.S. REITs are not taxed on income distributed to shareholders provided they comply with several requirements of the Internal Revenue Code of 1986, as amended (the Code). U.S. REITs are subject to the risk of failing to qualify for tax-free pass-through of income under the Code. Derivatives. A derivative instrument often has risks similar to its underlying instrument and may have additional risks, including imperfect correlation between the value of the derivative and the underlying instrument, risks of default by the other party to certain transactions, magnification of losses incurred due to changes in the market value of the securities, instruments, indices or interest rates to which they relate, and risks that the transactions may not be liquid. The use of derivatives involves risks that are different from, and possibly greater than, the risks associated with other portfolio investments. Derivatives may involve the use of highly specialized instruments that require investment techniques and risk analyses different from those associated with other portfolio investments. Certain derivative transactions may give rise to a form of leverage. Leverage magnifies the potential for gain and the risk of loss. Leverage associated with derivative transactions may cause the Fund to liquidate portfolio positions when it may not be advantageous to do so to satisfy its obligations or to meet earmarking or segregation requirements, pursuant to applicable SEC rules and regulations, or may cause the Fund to be more volatile than if the Fund had not been leveraged. Although the Adviser seeks to use derivatives to further the Fund s investment objectives, there is no assurance that the use of derivatives will achieve this result. The derivative instruments and techniques that the Fund may principally use include: Options. A decision as to whether, when and how to use options involves the exercise of skill and judgement and even a well conceived option transaction may be unsuccessful because of market behavior or unexpected events. The prices of options can be highly volatile and the use of options can lower total returns. Futures. A futures contract is a standardized agreement between two parties to buy or sell a specific quantity of an underlying instrument at a specific price at a specific future time. The value of a futures contract tends to increase and decrease in tandem with the value of the underlying instrument. Futures contracts are bilateral agreements, with both the purchaser and the seller equally obligated to complete the transaction. Depending on the terms of the particular contract, futures contracts are settled through either physical delivery of the underlying instrument on the settlement date or by payment of a cash settlement amount on the settlement date. A decision as to whether, when and how to use futures involves the exercise of skill and judgment and even a well conceived futures transaction may be unsuccessful because of market behavior or unexpected events. In addition to the derivatives risks discussed above, the prices of futures can be highly volatile, using futures can lower total return, and the potential loss from futures can exceed the Fund s initial investment in such contracts. Swaps. A swap contract is an agreement between two parties pursuant to which the parties exchange payments at specified dates on the basis of a specified notional amount, with the payments calculated by reference to specified securities, indexes, reference rates, currencies or other instruments. Most swap agreements provide that when the period payment dates for both parties are the same, the payments are made on a net basis (i.e., the two payment streams are netted out, with only the net amount paid by one party to the other). The Fund s obligations or rights under a swap contract entered into on a net basis will generally be equal only to the net amount to be paid or received under the agreement, based on the relative values of the positions held by each counterparty. Swap agreements are not entered into or traded on exchanges and there is no central clearing or guaranty function for swaps. Therefore, swaps are subject to credit risk or the risk of default or non-performance by the counterparty. Swaps could result in losses if interest rate or foreign currency exchange rates or credit quality changes are not correctly anticipated by the Fund or if the reference index, security or investments do not perform as expected. Other Risks. The performance of the Fund also will depend on whether or not the Adviser is successful in applying the Fund s investment strategies. The Fund is also subject to other risks from its permissible investments, including the risks associated with its investments in stocks of small and medium capitalization companies and ETFs. For more information about these risks, see the Additional Risk Information section. Additional Investment Strategy Information ETFs. The Fund may invest up to 10% of its net assets in shares of various ETFs that seek to track the performance of various portions or segments of the equity markets. No more than 5% of the Fund s net assets will be invested in any one ETF. Defensive Investing. The Fund may take temporary defensive positions in attempting to respond to adverse market conditions. The Fund may invest any amount of its assets in cash or money market instruments in a defensive posture that may be inconsistent with the Fund s principal investment strategies when the Adviser believes it is advisable to do so. Although taking a defensive posture is designed to protect the Fund from an anticipated market downturn, it could have the effect of reducing the benefit from any upswing in the market. When the Fund takes a defensive position, it may not achieve its investment objective. The percentage limitations relating to the composition of the Fund s portfolio apply at the time the Fund acquires an investment. Subsequent percentage changes that result from market fluctuations generally will not require the Fund to sell any portfolio security. However, the Fund may be required to sell its illiquid securities holdings, or reduce its borrowings, if any, in response to fluctuations in the value of such holdings. The Fund may change its principal investment strategies without shareholder approval; however, you would be notified of any changes. Additional Risk Information Small and Medium Capitalization Companies. Investing in securities of small and medium sized companies involves greater risk than is customarily associated with investing in larger, more established companies. Often, the stocks of these companies, particularly small companies, may be more volatile and less liquid than the stocks of more established companies and may be subject to more abrupt and erratic price movements. These stocks may have returns that vary, sometimes significantly, from the overall stock market. Often small and medium capitalization companies and the industries in which they are focused are still evolving and, while this may offer better growth potential than larger, more established companies, it also may make them more sensitive to changing market conditions. 5 Invesco Fundamental Value Fund

10 ETFs. Shares of exchange-traded funds have many of the same risks as direct investments in common stocks. Their market value is expected to rise and fall as the value of the underlying index rises and falls. In addition, the market value of their shares may differ from the net asset value of the particular fund. If the Fund invests in shares of ETFs it would, in addition to its own expenses, indirectly bear its ratable share of the ETFs expenses (i.e., advisory, administrative or 12b-1 fees). In addition, the Fund would have increased market exposure to those companies held in its portfolio that are also held by the ETF. The Fund s investments in the types of securities described in this prospectus vary from time to time, and at any time, the Fund may not be invested in all types of securities described in this prospectus. The Fund may also invest in securities and other investments not described in this prospectus. Portfolio Holdings A description of the Fund s policies and procedures with respect to the disclosure of the Fund s portfolio holdings is available in the Fund s SAI, which is available at Fund Management The Adviser Invesco Advisers, Inc. (the Adviser or Invesco) serves as the Fund s investment adviser. The Adviser manages the investment operations of the Fund as well as other investment portfolios that encompass a broad range of investment objectives, and has agreed to perform or arrange for the performance of the Fund s day-to-day management. The Adviser is located at 1555 Peachtree Street, N.E., Atlanta, Georgia The Adviser, as successor in interest to multiple investment advisers, has been an investment adviser since Civil lawsuits, including a regulatory proceeding and purported class action and shareholder derivative suits, have been filed against certain Invesco Funds, INVESCO Funds Group, Inc. (IFG) (the former investment adviser to certain Invesco Funds), Invesco Advisers, Inc., successor by merger to Invesco Aim Advisors, Inc., Invesco Distributors, Inc. (Invesco Distributors), formerly Invesco Aim Distributors, Inc. (the distributor of the Invesco Funds), and/or related entities and individuals, depending on the lawsuit, alleging among other things that the defendants permitted improper market timing and related activity in the Funds. Effective June 1, 2010, Invesco Ltd., the ultimate parent company of Invesco Advisers, Inc., acquired the retail asset management business of Morgan Stanley & Co., including the Van Kampen Funds business. Certain of the former Morgan Stanley and Van Kampen open and closed-end funds and Van Kampen service providers to those funds were involved in litigation prior to June 1, 2010, as more fully described in the Statement of Additional Information, if applicable. Additional civil lawsuits related to the above or other matters may be filed by regulators or private litigants against Invesco Funds, IFG, Invesco, Invesco Distributors and/or related entities and individuals in the future. More detailed information concerning all of the above matters, including the parties to the civil lawsuits and summaries of the various allegations and remedies sought in such lawsuits, can be found in the Statement of Additional Information. Adviser Compensation Advisory Agreement. The Fund retains the Adviser to manage the investment of its assets and to place orders for the purchase and sale of its portfolio securities. Under an investment advisory agreement between the Adviser and the Fund, the Fund pays the Adviser a monthly fee computed based upon an annual rate applied to the average daily net assets of the Fund as follows: Average Daily Net Assets % Per Annum First $500 million 0.670% Over $500 million 0.620% The Adviser has contractually agreed, through at least June 30, 2012, to waive advisory fees and/or reimburse expenses of all shares to the extent necessary to limit Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement (excluding certain items discussed below) of Class A shares to 1.65%, Class B shares to 2.40%, Class C shares to 2.40% and Class Y shares to 1.40% of average daily net assets, respectively. In determining the Adviser s obligation to waive advisory fees and/or reimburse expenses, the following expenses are not taken into account, and could cause the Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement to exceed the limit reflected above:(i) interest; (ii) taxes; (iii) dividend expense on short sales; (iv) extraordinary or non-routine items; and (v) expenses that the Fund has incurred but did not actually pay because of an expense offset arrangement. Unless the Board of Trustees and Invesco Advisers, Inc. mutually agree to amend or continue the fee waiver agreement, it will terminate on June 30, A discussion regarding the basis for the Board s approval of the investment advisory and investment sub-advisory agreements of the Fund is available in the Fund s most recent report to shareholders for the twelve month period ended August 31. Portfolio Managers The following individuals are jointly and primarily responsible for the day-to-day management of the Fund s portfolio: m Thomas Bastian (lead manager), Portfolio Manager, who has been responsible for the Fund since 2010 and has been associated with Invesco and/or its affiliates since Mr. Bastian served as Portfolio Manager of the predecessor fund since Prior to commencement of operations by the Fund, Mr. Bastian was associated with Morgan Stanley Investment Advisors Inc. in an investment management capacity (2003 to 2010). m Mark Laskin, Portfolio Manager, who has been responsible for the Fund since 2010 and has been associated with Invesco and/or its affiliates since Mr. Laskin served as Portfolio Manager of the predecessor fund since Prior to commencement of operations by the Fund, Mr. Laskin was associated with Morgan Stanley Investment Advisors Inc. in an investment management capacity (2000 to 2010). m Mary Jayne Maly, Portfolio Manager, who has been responsible for the Fund since 2010 and has been associated with Invesco and/or its affiliates since Ms. Maly served as Portfolio Manager of the predecessor fund since Prior to commencement of operations by the Fund, Ms. Maly was associated with Morgan Stanley Investment Advisors Inc. in an investment management capacity (1992 to 2010). m Sergio Marcheli, Portfolio Manager, who has been responsible for the Fund since 2010 and has been associated with Invesco and/or its affiliates since Mr. Marcheli served as Portfolio Manager of the predecessor fund since Prior to commencement of operations by the Fund, Mr. Marcheli was associated with Morgan Stanley Investment Advisors Inc. in an investment management capacity (2002 to 2010). m James Roeder, Portfolio Manager, who has been responsible for the Fund since 2010 and has been associated with Invesco and/or its affiliates since Mr. Roeder served as Portfolio Manager of the predecessor fund since Prior to commencement of operations by the Fund, Mr. Roeder was associated with Morgan Stanley Investment Advisors Inc. in an investment management capacity (1999 to 2010). 6 Invesco Fundamental Value Fund